Magazine article International Trade Forum

Opinion Piece: Technology Alone Is Not Enough

Magazine article International Trade Forum

Opinion Piece: Technology Alone Is Not Enough

Article excerpt


Information and communication are essential to trade. In the most general terms, buyers must communicate with sellers, both m must have information about product and pricing, and negotiation of any kind requires selective communication of information. As a result, information and communications technologies (ICTs) feature prominently in aid for trade discussions. But, while ICTs can be helpful in a variety of entrepreneurial scenarios, ICTs alone very rarely create meaningful change. A focus on human and institutional capacity remains indispensible.

One well-known example of ICT-for-development is the e-Choupal project run by Indian agriculture conglomerate ITC (previously Indian Tobacco Company). Most media descriptions of the e-Choupal project are as follows: agrarian villages are supplied with a PC and satellite Internet connection that is paid for by ITC and operated by a local farming household. Online, village farmers check commodity prices, learn about farming practices, and place orders for seeds and fertilizers. Over time, farmers learn to sell directly to ITC, and both parties benefit by cutting out expensive middlemen.

The project has garnered widespread acclaim, including the Development Gateway Award and the Stockholm Challenge Award, both international prizes that highlight innovative uses of ICT in development. The company caters to this attention, and consistently speaks of the project in terms of ICT.

Closer inspection, however, reveals a completely different reality. When I visited one e-Choupal near Bhopal in 2004, the PC had not been turned on in months, and farmers were certainly not learning about agriculture online. They did, however, appear to be selling directly to ITC. It turns out that in addition to the e-Choupals, ITC builds modern trading stations within a few kilometres of the villages, each manned by ITC personnel and equipped with industrial weighing machines, warehouses for storage and office space. Farmers go to the trading stations to have their harvest assessed and leave within hours with payment in hand. Compared with corrupt middlemen, who often make the farmers wait for days as an aggressive negotiation strategy, ITC's stations are a welcome relief.

Importantly, it's not the computers but the physical trading stations and their corporate efficiency that matter. Computers are used in station offices, but only for routine office bookkeeping. And as for the e-Choupal PCs, if the farmers didn't also have access to the trading stations, they would probably see no benefit. Conversely, even if an e-Choupal PC isn't operating--as in the village I visited--the farmers still benefit from the stations. Tellingly, ITC stopped putting PCs in villages in 2007.

The e-Choupal project is remarkable because of the canyon between public perception of the project and what is happening on the ground. While ITC deserves credit for their trading stations, overhyped ICT stories result in misconceptions about what technology can accomplish. They leave an impression that ICT provides packaged solutions to complex problems in trade and development, when technology is better thought of as a tool that requires an able user to wield it. Technology is a magnifier of human and institutional intent and capacity. Its impact is multiplicative, not additive. …

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